TITLE 29

State Government

Public Officers and Employees

CHAPTER 60A. DEFERRED COMPENSATION FOR PUBLIC OFFICERS AND EMPLOYEES OF THE STATE

§ 6051 Purpose.

The purpose of this chapter is to create a vehicle through which all employees of the State may, on a voluntary basis, provide for additional retirement income security through a program of deferred compensation. The deferred compensation program provided by this chapter shall be in addition to any retirement or other benefit program provided by law for employees of the State.

(2) "Deferred compensation" means income earned as a public officer or employee of the State which, pursuant to a written agreement between the State and the employee, is set aside for retirement purposes.

(3) "Deferred compensation program" means such plans to allow deferred compensation pursuant to §§ 457, 403(b) and 401(a) of the Internal Revenue Code [26 U.S.C. §§ 457, 403(b) and 401(a)], as may be adopted by the Board.

(4) "Employee" means an individual who is employed by the State, including elected or appointed officials, and who receives compensation wholly or in part directly from the State Treasury or through an agency within the State that is wholly or in part supported by the State. The term "employee" includes employees of the Delaware Transit Corporation and Delaware Solid Waste Authority. Individuals hired on a temporary basis or as consultants shall not qualify as employees.

(5) "Qualified participant" is defined as an employee of the State, including school districts, who has deferred compensation under the provisions of this chapter and satisfies either of the following conditions:

a. Employee must be enrolled in the deferred compensation program for no less than 6 consecutive months immediately preceding receipt of the match;

b. Employee has deferred the maximum allowable by the Internal Revenue Service within the 6 months preceding receipt of the match.

(a) All plans of deferred compensation which may be adopted shall provide that each participating employee will be furnished a quarterly statement of the employee's account, on a form approved by the Board, showing at least the amount of income deferred, the investments purchased and the charges assessed on such purchases.

(b) Each plan of deferred compensation which may be adopted shall provide that in the event of nonrenewal or termination, all accounts enrolled in the plan, including all records, investments and proceeds thereof, shall be transferred to an agent designated by the Board.

The Department of Finance and the State Treasurer are authorized to make payroll deductions under this chapter pursuant to regulations adopted by the Board for any public officer or employee of the State who has authorized such deductions in writing. The Treasurer of the State shall account for all such payroll deductions and shall make payment of such deductions in accordance with regulations adopted by the Board. Any income deferred under such a plan shall continue to be included as regular compensation for the purpose of computing the contributions to and benefits from the State Employees' Pension Plan, any pension plan for members of the state judiciary and any pension plan for members of the State Police. Unless subject to the provisions of § 6062 of this title, any sum so deferred shall not be included in the computation of any federal or state income taxes withheld on behalf of any such employee, but shall be included for computation of Social Security Administration contributions.

Any provision of this chapter notwithstanding, the maximum amount of income which any 1 employee may elect to defer after June 30, 1975, shall not exceed the limit established by the Internal Revenue Service.

Commencing January 1, 2001, and each pay period thereafter, an amount equal to 100 percent of the voluntary contribution of every qualified participant, not to exceed $10 per pay period, shall be credited to the § 401(a) [26 U.S.C. § 401(a)] account of each qualified participant making a voluntary deferral under the provisions of this chapter. The employer contribution shall be remitted each pay period by the State Treasurer from an appropriation authorized for this purpose.

Modifications to the match amount per pay period, percentage of contribution matched, number of pay periods per year to be matched and other fiscal and operational aspects of the program are contingent upon funding by the General Assembly and may be administered through rules and regulations promulgated by the Board and pursuant to § 401(a) of the Internal Revenue Code (26 U.S.C. § 401(a)).

(a) The Board shall ensure that 26 U.S.C. §§ 403(b) and 457(b) retirement plans allow participants the option to designate their contributions into the plans as Roth contributions.

(b) The Office of Management and Budget shall make all necessary changes to the state employee payroll system necessary to facilitate the addition of a Roth option to state 403(b) and 457(b) retirement plans for state employees.

(c) The State Treasurer shall take all necessary steps to facilitate the addition of a Roth option to state 403(b) and 457(b) retirement plans.